The bill even revamps the federal government’s system for making loans to college students. The loans would now be given to students directly, eliminating a decades-old program whereby private banks made student loans based on a government guarantee.

For more than 100 current Yeshiva University students who hold loans under the soon-to-be-ended system, the change will mean more paperwork. Bob Friedman, Yeshiva’s student financial aid director, said the school planned to contact those students and urge them to consolidate their loans under the new program to simplify their loan payments.

But many student borrowers will not notice a change, Friedman said, because the new law does not change the interest rate or amount of government-backed loans. “This can be completely seamless to students,” he said.

Students would, however, no longer have a say in what company collects their loan payments and provides customer service on their loans – the federal Department of Education is saving money by handing out contracts for that work.

The bill would direct some of that savings – $36 billion over 10 years – to sustain funding of federal Pell Grants for low-income students for years to come. And it creates a $2.5 billion grant program that community colleges can use for new construction. Schools in Brooklyn and the Bronx would have to compete for that funding.